BP and partners face $45m in fines over Gulf oil spill

Notices served against BP, Transocean and Halliburton by US government over Deepwater Horizon disaster BP and its partners on the doomed Deepwater Horizon oil rig face fines of up to $45m after receiving formal notice of a series of safety violations leading up to the Gulf of Mexico disaster. In a first step of a long legal battle, the interior department said BP, rig operator Transocean and contractor Halliburton between them broke 15 rules governing offshore drilling ahead of the 20 April 2010 explosion. Eleven workers were killed and 4.9m barrels of oil were pumped into the Gulf of Mexico before the well was capped. Wednesday’s notices mark the first time the US government has gone after contractors – in this case Transocean and Halliburton – in addition to oil companies. The tactic could influence lawsuits between BP and its partners over their responsiblility. BP still faces separate penalties of up to $21bn for environmental violations. The notices have come a day before executives from all three companies are due to testify before Congress on the findings from the latest investigation. A coast guard finding last month said cost-cutting by BP and its partners were “contributing causes” of the fatal blowout. Michael Bromwich, director of the Bureau of Ocean Energy Management, Regulation and Enforcement, said in a statement that the notices of non-compliance were a first step in addressing the violations detailed in that investigation. “Companies that violate federal regulations must be held accountable,” he said. “The joint investigation clearly revealed the violation of numerous federal regulations designed to protect the integrity of offshore operations.” BP received seven of the notices, including failure to maintain control over the well, failure to prevent pollutants from leaking into the Gulf and health and safety violations. Transocean was cited four times, for failing to control the well and the blowout preventer, the last line of defence against a disaster. Halliburton was cited four times, for failure to cement the well properly and for health and safety violations. The relevant fines are capped at $35,000 a day per incident – an amount that Bromwich has in the past described as too low to be an effective deterrent. It would cap the fines on BP and the other companies at about $45m if they were held to be in violation for the duration of the 87-day spill. BP faces far stiffer penalties under the US Clean Water Act, which is assessed on the amount of oil spilled and could cost the companies up to $21bn. The companies have 60 days to appeal against the sanctions. Transocean said it would appeal. All three companies are pursuing lawsuits against one another and BP said in a statement that the notices showed its partners were partly to blame. “We continue to encourage other parties, including Transocean and Halliburton, to acknowledge their responsibilities in the accident.” BP Oil spills BP oil spill United States Suzanne Goldenberg guardian.co.uk

Posted by on October 13, 2011. Filed under News, Politics, World News. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.